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F. C. BROOKS & SONS, INC. v. SHELL OIL COMPANY.
25781.
Equitable petition. Cobb Superior Court. Before Judge Hames.
FELTON, Justice.
The motion to dismiss the complaint was properly sustained.
F. C. Brooks & Sons, Inc. brought an action against Shell Oil Company. The complaint as amended alleged substantially as follows:
Plaintiff was an authorized commission distributor for Shell in the Marietta, Cobb County area from 1937 until the termination of their then-current agreement (Exhibit "A") under its provisions on November 30, 1968. During the course of its business relationship with Shell, the plaintiff leased nine tracts of land at various locations throughout Cobb County for use as automobile service station sites. Each of the leasing instruments committed a provision for termination of the lease by either party, except for a 15-year lease entered into in 1960 (Exhibit "B"), which gave termination rights only to Shell. At that time "a spirit of congeniality and trustworthiness" existed between the parties and this spirit, together with the legal relationship between them, led plaintiff to feel that a close examination and strict adherence to the prior plan of termination was not necessary. Further, this feeling was strengthened by verbal statements by defendant's representatives at that time and thereafter, to the effect that defendant "had never been known to terminate a commission-distributor agreement without releasing all of its stations and properties." The above circumstances and the fact that plaintiff was receiving distributor's commission for sales of Shell's products at the leased station sites led plaintiff to rent the latter site for $325 per month, which was substantially below the fair rental value. Plaintiff erected at his own expense a $26,000 service station on said site. Plaintiff's commission income from this site averaged over $10,000 annually. In August 1968, defendant notified plaintiff that on December 1, 1965, it would take over a large portion of the profit-making activity which plaintiff had theretofore performed under their agreement and that, approximately one year from August, 1969, the defendant would take over the sale of all Shell products in that area and cancel their commission-distributor agreement. In order to protect its rights and business interests in the eight locations with mutual lease termination rights, plaintiff terminated said leases in August, 1968 and the distributorship agreement effective November 30, 1968. Relying on defendant's previous representation and stated policy, plaintiff made formal demand (Exhibit "C") for termination of the 1960 lease, which defendant refused to do. Defendant made additions to the subject properly, causing plaintiff's taxes to increase and profits to decrease. Defendant has not dealt in good faith with plaintiff and the subject lease was not an arm's length transaction. Defendant has taken unfair advantage of plaintiff from a position of superior strength by canceling the distributorship agreement without cause without also canceling the subject lease agreement, under with circumstances plaintiff is leasing the property for much less than the fair rental value. The continuation of the distributorship agreement during the term of the subject lease was an implied covenant to said lease and the termination of said agreement constitutes a violation of such covenant and the subject lease should be rescinded and declared a nullity. "[B]y reason of the facts as hereinabove set forth the defendant has breached
the oral contract as hereinabove alleged and your plaintiff is entitled to specific performance thereof by reason of the plaintiff['s] having no adequate remedy at law." The prayer is for specific performance of the alleged "oral contract."
The trial court sustained the defendant's motion to dismiss the complaint as amended, from which judgment the plaintiff appeals.
1. A contract for a lease of land for a period longer than one year must be in writing (Code 20-401 (4); Byrd v. Piha, 165 Ga. 397, 400 (141 SE 48)), and the writing "must be complete in itself, leaving nothing to rest in parol." F. & W. Grand &c. Stores v. Eiseman, 160 Ga. 321, 325 (127 SE 872). " 'Parol contemporaneous evidence is inadmissible generally to contradict or vary the terms of a valid written instrument.' Code 38-501. 'All previous negotiations are merged in the subsequent written contract, and an additional obligation can not be granted thereon by parol testimony.' [citations]." Dixie Belle Mills v. Specialty Mach. Co., 217 Ga. 104, 105 (120 SE2d 771). This is especially true in a case such as the present one, in which the written contract contains the provision that "[t]his lease merges and supersedes all prior negotiations, representations and agreements, and constitutes the entire contract, between lessor and Shell concerning the leasing of the premises and the consideration therefor." See Curtis v. Pierce, 157 Ga. 717 (122 SE 208); Morgan Constr. Co. v. Kitchings, 110 Ga. App. 599 (139 SE2d 417).
2. Even if the defendant's alleged course of conduct was pursued with the intention of taking unfair advantage of the plaintiff and even if the defendant's alleged verbal representations could be shown to constitute a parol agreement to the effect contended, the complaint does not state a claim for specific performance of such parol contract. Since the subject lease instrument was valid and complete and since it specifically gave to only the defendant the right of termination, the alleged parol agreement would vary the terms of the written instrument, hence it was merged in and superseded by the written instrument. Notwithstanding the allegations to the contrary and the real or imagined "spirit of congeniality and trustworthiness" between the parties, they were nevertheless, engaged in an arm's-length business relationship and transaction, which required the plaintiff to read all contracts to ascertain that they incorporated all of the parties' oral agreements before executing them. Having waived the incorporation of the alleged parol agreement for its lease termination rights in the written lease instrument, the plaintiff is bound by the terms of the instrument as written.
The court did not err in its judgment sustaining the motion to dismiss the complaint.
Judgment affirmed. All the Justices concur.
Raymond M. Reed, G. Robert Howard, for appellee.
Holcomb & McDuff, Frank D. Holcomb, Robert E. McDuff, for appellant.
ARGUED MAY 11, 1970 -- DECIDED JUNE 9, 1970.
Friday May 22 16:42 EDT


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